Macroeconomics - e If Microsoft develops a new operating...

Brittany Steiner September 16, 2009 Macroeconomics Problem Set One 1. A. Positive Analysis- Microeconomics B. Normative Analysis- Microeconomics C. Positive Analysis- Macroeconomics D. Positive Analysis- Macroeconomics E. Normative Analysis- Macroeconomics F. Positive Analysis- Microeconomics 2. Find the Missing Dollar- There is no missing dollar, the room ended up being 25 dollars, and the bellboy kept 2 more dollars. The men ended up paying a total of 27 dollars, and then received three dollars back from the bellboy. $25+$2+$3= $30. All of the money is there. 3. Opportunity Costs a. If you go to college you cannot save the money you use for tuition or get a job. b. If you buy a milkshake you cannot use that same money to buy a soda. c. If you like the milkshake so much you decide to open a milkshake café you cannot use that money to save for a house or invest in a new business. d. If you study economics on a Friday night you cannot go out and party.

This
preview
has intentionally blurred sections.
Sign up to view the full version.

This is the end of the preview.
Sign up
to
access the rest of the document.

Unformatted text preview: e. If Microsoft develops a new operating system for business computers they can no longer use that money to develop other technology. f. If President Barack Obama cuts taxes he cannot use the extra tax money to develop new things for the country. g. If NASA sends a manned expedition to Mars, the government can no longer use that money towards the war or other important things. 4. A. On separate sheet of paper B. The production of 40 airplanes and 40 buses is feasible and efficient. The production of 60 airplanes and 60 buses is unattainable; there are inefficient resources and technology to produce that. C. When only 20 airplanes and 20 buses are produced, we call this inefficient. More products can be produced. D. The opportunity cost of increasing production of airplanes from 50 to 60 would be 20 buses. The opportunity cost of increasing 0 to 10 airplanes would be 5 buses....
View
Full Document